GBP/USD Sails Over 1.5000
Yesterday proved to be another interesting day on the markets as they were gripped by volatility after several data releases caused unexpected moves.
Retail sales from the UK were worse than expected and this caused a drop in Sterling, especially against the Euro. The Greek situation continues to dominate European headlines as Angela Merkel met with Greek PM Tsipras in Brussels. Although she insisted that all contents of their discussion were to remain confidential, this has not stopped speculation. Even though people are pessimistic over an immediate resolution to this crisis, and are worried that Greece will run out of money, Chancellor Merkel insisted “everything must be undertaken to prevent that.”
Whilst the Pound fell against the Euro, it practically rocketed against the Dollar which itself released poor data. Unemployment benefits in the US rose by 1,000 last week to 295,000 compared to the expected 287,000. New home sales also slumped as fears of erratic economic growth deterred new buyers. This could put the brakes on an interest rate hike as the Fed is looking for much more balanced growth across the economy. With the Monetary Policy Committee hinting that keeping interest rates at their lows was a “finely balanced” decision for a minority of officials, we saw the Pound sail over 1.5000.
As the EU meet in Brussels today, it’s a relatively quiet morning on the data front and we await Durable Goods Orders from the US this afternoon to see where we are headed.
Have a good weekend!